Bitcoin Dominance Weakens as Altcoins Rally
Solana’s SOL and ether both hit record highs during the week, while bitcoin was little changed.
Bitcoin, the world’s largest cryptocurrency by market value, was little changed between $60,000 and $63,000 Friday before release of the U.S. jobs report. The price is also little changed over the week, while altcoins and gaming tokens have seen significant gains.
Solana’s SOL token has rallied 21% this week, breaking through its all-time high on Thursday. Ether (ETH) also climbed to a record, hitting $4,628 on Nov. 3. It is up 2.4% on the week.
“Alternative coins to ETH are still in favor,” said Daniel Kukan, a trader at Crypto Finance AG.
The bitcoin dominance chart, which shows the extent of the cryptocurrency’s dominance over the rest of the market, is signaling a bias toward altcoin exposure, according to Matthew Dibb, COO of Stack Funds.
“This trend will likely persist for the short term,” he said.
The chart shows bitcoin dominance declining as altcoins take a larger share.
“We have seen consistent bids for Layer 1 tokens throughout any market weakness,” said Dibb.
Avalanche’s AVAX token touched an all-time high $80.29 on Friday and is up 20% on the week. Polkadot’s DOT has also made significant gains this week and is up 20%.
Coins related to virtual worlds, or so-called metaverses, were also in the spotlight after Facebook said it will change its name to Meta and enter the arena.
“The recent rebranding from Facebook to Meta is making the crypto market reassess the future value of these metaverse competitors, which until last week, many of them were fairly undervalued” said Juan Pellicer, a research analyst at IntoTheBlock.
MANA, the currency of Decentraland, a virtual world on the Ethereum blockchain that allows users to monetize content and applications, is up 88% on the week. SAND, the token of The Sandbox, also a virtual world where players can build, own and monetize their gaming experiences using non-fungible tokens, has gained 132%.
Play-to-earn tokens have also experienced an uptick. Axie Infinity’s AXS token is up 5% on the week. Enjin coin (ENJ), the token of Enjin, a gaming community platform and virtual goods marketplace with a market cap of $2.6 billion, is up 28%.
Enjin announced Thursday that it has formed a $100 million fund to support projects in its ecosystem geared toward developing a decentralized metaverse. The fund will focus on cross-chain NFT assets, digital collectible applications, gaming that harnesses mixed reality, virtual events and building multichain infrastructure.
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